A Lack of Guts and Intellectual Vigor Hobbles the Foundation World

The foundation world has long been a backwater of lazy thinking, uncritical attitudes, self-satisfaction, and backslapping. In recent months, a few top foundation executives have written thoughtful speeches and articles challenging institutional practices and encouraging more effective performance. But their work stands out precisely because most of American philanthropy suffers from intellectual torpor and a lack of critical analysis.

The inability or unwillingness of most foundation officials to tackle the most challenging problems facing grant makers has left the task to a handful of academic researchers and practitioners. The result: a field that is poorly equipped to deal with its weaknesses and future role.

Part of the reason for this failing can be attributed to an exaggerated sense of collegiality that suffuses the field and stifles internal criticism. The lack of transparency, media scrutiny, and public accountability are other factors.

But the major culprits are the chief executives of foundations, especially of the large ones, who appear to have thought little and written even less about their world — its performance, standards, problems, and challenges.

The grant-making scene bristles with important — and controversial — issues. Should government in a democracy limit the asset size of foundation to ensure that the billions of tax-exempt dollars they hold are used effectively to meet the most-urgent public needs? Should the governance decisions of foundations be open to greater public scrutiny? Should foundation boards be more representative of the constituencies that grant makers purport to serve?

The list of issues goes on, but few foundation executives are willing to take them on.

What is so surprising about this state of affairs is that a large number of these foundation executives come from the academic world. Many of them have been presidents or deans of universities and colleges. Most of the former academic officials have doctorate degrees. Presumably, they have taught, done research, and written tracts and books, however illuminating or boring, to maintain their former academic positions. Have they lost their cerebral capabilities and writing skills since making the transition to philanthropy? In many cases, they are receiving salaries that are double or more than the amount of money they earned in academe. Not a bad trade-off: more money for probably less-time-consuming work.

Former academics are not the only ones to have jumped on the philanthropic gravy train. Business executives, consultants, members of various professions, and nonprofit practitioners have also been recruited to fill major foundation positions. They, too, must have been required to think critically and write persuasively — or at least have others write for them — to have been successful at their former jobs. Why, then, have they also joined their academic colleagues in an atmosphere of silence once inside the world of philanthropy?

Whatever the reasons for this phenomenon, it is encouraging to see a trickle of philanthropoids bucking this trend. For several years, Ed Skloot, executive director of the Surdna Foundation, has been writing about foundation priorities and the reasons that foundations do not perform better.

Likewise, Gara LaMarche, director for U.S. programs at the Open Society Institute, has, in articles and speeches, questioned the responsiveness and accountability of foundations. He has pointed to grant makers’ timidity in addressing controversial public-policy issues, to their intrusiveness in their grantees’ programs, and to their lack of self-criticism.

Lance Lindblom, president of the Nathan Cummings Foundation, in a speech to the annual conference of Independent Sector last fall, called for a new vision on the part of philanthropic institutions.

Bruce Sievers, retiring executive director of the Walter and Elise Haas Fund, has produced thoughtful articles on venture philanthropy, while Thomas G. David, executive vice president of the California Wellness Foundation, recently wrote a strong piece on the need for foundations to provide general operating support to grantees — and not just program money. And a few executives, such as Vartan Gregorian, president of the Carnegie Corporation, have written opinion articles on the mission and work of foundations.

On the right, foundation executives such as Chester Finn, president of the Thomas B. Fordham Foundation; William Schambra, senior director of programs of the Lynde and Harry Bradley Foundation; and Heather Richardson Higgins, president of the Randolph Foundation, have written in recent years about the impact and shortcomings of philanthropy.

But this sprinkling of thoughtful writers will not be enough to provide the foundation world with the intellectual vigor and critical faculties it needs.

One might have thought that the Council on Foundations would be an important leader in encouraging more introspection and critical analysis within philanthropy, at least among its members. Unfortunately, the council appears to be far more concerned about its public-relations effort to sell foundations to the American public than about improving and strengthening foundation performance, accountability, and relationships with grantees. The council has done little in its day-to-day activities to advance the relationship between foundations and grantees, it sat on the sidelines during congressional debates over phasing out the estate tax, and it refused to take a position on using the excise tax on foundations to help pay for expanded enforcement activities by the Internal Revenue Service and state attorneys general.

The more conservative Philanthropy Roundtable has seemed to be a more exciting venue for the discussion of substantive and challenging ideas. It has been less afraid to tackle controversial problems and issues than has the Council on Foundations.

Unless the Council on Foundations makes a 180-degree turn, the responsibility for thinking and strategizing about philanthropy will have to fall on individual leaders in the foundation world, a group that to date has shown little interest in or aptitude for the task.

We can only hope that the events of September 11 will prompt a new phase of introspection and analysis among foundation executives. The gravity of the episode and its impact on nonprofit groups have put a spotlight on a number of issues that foundations should be concerned about: Has foundation money been used efficiently and fairly to aid victims of the tragedy? Are foundations adequately supporting small charities that have experienced declines in donations because of the public’s outpouring of gifts to nonprofit groups set up in the wake of the attacks? And what of the long-term issues that arise from the attacks and the simultaneous economic recession: Should foundations be paying out more of their assets in grants, especially during times of national crises? Foundations have had plenty to think and write about.

If the momentous events of September 11 don’t move foundations to abandon their ivory towers and become engaged in the issues of the day, nothing will.

Bill Moyers, speaking at a meeting of the Environmental Grantmakers Association in October, issued a call to action that should apply to every foundation leader in the United States:

“We’re survivors now, you and I,” Mr. Moyers said. “We will be defined not by the lives we led until the 11th of September, but by the lives we will lead from now on. So go home — make the best grants you’ve ever made. And the biggest — we have too little time to pinch pennies. Back the committed and courageous people in the field — and back them with media to spread their message. Stick your neck out. Let your work be charged with passion, and your life with a sense of mission. For when all is said and done, the most important grant you’ll ever make is the gift of yourself, to the work at hand.”

Amen.

Pablo Eisenberg is senior fellow at the Georgetown University Public Policy Institute and a member of the executive committee of the National Committee for Responsive Philanthropy. He is a regular contributor to these pages. His e-mail address is pseisenberg@erols.com.